Somalia president rejects UN graft charges

Somalia's president has dismissed a UN report that accuses senior officals of corruption as he campaigns for re-election in a landmark vote.

Sharif Ahmed denied on Friday that large portions of state funds had been misappropriated in recent years as he defended his record in the run-up to an election that would end a succession of UN-backed transitional governments, in place since 2004.

Western and regional states have given millions of dollars in aid to the country's transitional federal government [TGF], and sent African troops to help crush al-Shabab fighters.

Fraud allegations

The United Nations' Somalia monitoring group said in July that it had found that, out of every $10 received by the transitional federal government [TFG] between 2009-2010, $7 never made into the state's coffers.

The report also said that in 2011 almost a quarter of the government's total expenditure - more than $12 million - was absorbed by the offices of the country's three top leaders.

Ahmed, who took over as head of the transitional government in 2009, denied that funds had been misappropriated, saying they had been spent to lift Somalia, which has been devastated by decades of conflict and a series of droughts, out of its severe state of crisis.

"We regret this report. It is a fabricated report and a lie. Those people who compiled it are intent for Somalia to stay as it is," Ahmed told Reuters on Thursday in the plush garden of Villa Somalia, his official residence in Mogadishu.

"If money had been seized, Somalia would never have reached the stage it has today," Ahmed said, citing progress in security conditions.

Privately though, Somalia-focused diplomats in Nairobi say Ahmed has failed to deliver on security gains and basic public services.

International observers say it is too difficult to predict who will win the election in the country.

Deadly Kenyan attack on al-Shabab

Meanwhile, Kenyan security forces assisting the Somalian army killed 73 al-Shabab fighters in an attack at the remote Somalian region of Fafadun, a military source said on Thursday.

"There was an attack in Somalia at a place called Fafadun. Seventy three Al Shabab were killed and there are two KDF [Kenyan defence forces] casualties," the source said.

Three other Kenyan soldiers were wounded in Thursday afternoon's attack.

"It was a very violent confrontation because the Al Shabaab militants were heavily armed and ready for war. Forty AK-47 rifles were seized from the slain militants," another source said.